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Although the G20 summit is often regarded as just an annual photo opportunity for the world leaders with fruitless outcomes, the agenda on some leader’s minds this year has on the contrary, the potential to gravely disrupt and move markets.

United States (US) President Donald Trump and China President Xi Jinping are expected to meet on the side lines of the upcoming G20 summit at Bueno Aires, Argentina, where world leaders will convene on Friday and Saturday. The setting will take place in a highly anticipated dinner on Saturday and observers are hoping for the leaders to strike a deal over their ongoing trade spat.

The US has hit a total US$250 billion worth of Chinese goods with tariffs since July, and China has retaliated by imposing duties on US$110 billion of US goods.

The G20 summit dinner is seen by some as the possible pivotal breakthrough point between the leaders of the world’s two largest economies, and could reveal answers as to whether the trade war can be stopped or put on hold.

Will talks really see a breakthrough? Unlikely so says experts

Just days before the G20 summit, President Trump said the current tariff levels on US$200 billion of Chinese imports would rise as planned.

In an interview with The Wall Street Journal on Monday, Mr Trump repeated his threat to slap tariffs on all remaining imports from China, adding that “the only deal would be (that) China has to open up their country to competition from the US.”

"If we don't make a deal, then I'm going to put the US$267 billion additional (tariffs) on," at a tariff rate of either 10% or 25%, Mr Trump threatened further, adding that the next round of tariffs could be on goods which are not yet hit by tariffs, such as laptops and Apple iPhones imported from China.

Moments before leaving for Argentina on Thursday, Mr Trump told reporters at the White House that while China was interested in striking a deal, "I don't know if I want to do it" and "I like the deal we have now".

Most experts think that it is unlikely for US and China to have a trade war ceasefire over dinner and do not expect much from the G20 meeting.

Capital Economics Julian Evans-Pritchard said the most likely scenario is that Mr Xi doesn't offer big enough concessions to Mr Trump, and “so nothing much comes of the G20 meeting."

“Both sides are trying to manage expectations, because it is unlikely that something dramatically successful will take place,” added Mr Willie Lam, Adjunct Professor at The Chinese University of Hong Kong.

China’s state-run China Daily newspaper said in an editorial: “Beijing wants a deal, just as Washington does. And it is willing to cooperate with Washington in dealing with concerns about trade if they are fair-minded."

"Should there be any other aspirations, such as taking advantage of the trade spat to throttle Chinese growth, then an agreement is unlikely to be reached," the paper said.

What’s on US’ agenda

At the G20 summit, Mr Trump is likely to focus on alleged Chinese theft of intellectual property, ownership of American companies in China and, tariffs and non-tariff barriers.

White House economic advisor Larry Kudlow had offered a more optimistic sentiment at a White House briefing on Wednesday, saying that there is “a good possibility” the US can make a deal with China and that Mr Trump is open to a deal.

But Mr Kudlow added the caveat that “certain conditions have to be met, certain things have to be changed," in order for a deal to come through.

Mr Kudlow thinks the US and China have a “good possibility” in reaching a deal at the dinner on Saturday, adding that the US is in a "better shape to weather this than the Chinese are."

Some observers note that the issue the US has with China is the limitations on the access foreign firms in China have with its consumers, which makes it difficult for foreign companies to invest into the country. Without a joint venture with a local firm, foreign firms are unable to sell their goods to Chinese customers.

The sharing and joint partnership problems translate to technology and intellectual property transfer concerns, which are the deeper issues America actually has with China.

Even as the trade spat continues on between the world’s two largest economies, China is not looking to put all its eggs in one basket as it has declared that it will widen market access for foreign investors, by working with countries such as Spain. On Wednesday, ahead of the G20 meeting, China’s Xi said the country will widen market access for foreign investors and step up protection of intellectual property rights.

"China will make efforts to open, even more, its doors to the exterior world and we will make efforts to streamline access to markets in the areas of investment and protect intellectual property," Mr Xi said, without making any reference to Mr Trump or the US-China tariff war.

One can take reference from Mr Xi’s earlier view to understand his method of leadership. On November 16, at the APEC summit at Papua New Guinea, President Xi took a jab at the US in his speech, where he said: “History has shown that confrontation - whether if it is in the form of a cold war, open war, or trade war - will produce no winners.”

"We believe that there exist no issues that countries cannot resolve through consultation," said the Chinese leader, as long as negotiations take place in a spirit of "equality" and "mutual understanding".

US Vice President Mike Pence retaliated to Mr Xi’s speech at the earlier APEC summit with the words: “China’s taken advantage of the US for many, many years, and those days are over.”

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